(2_FIDELITY_LOGOS)FIDELITY INVESTMENTS
VARIABLE LIFE ACCOUNT I
ANNUAL REPORT
DECEMBER 31, 1996
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE SUBMITTED FOR
THE GENERAL INFORMATION OF FIDELITY
INVESTMENTS LIFE INSURANCE COMPANY VARIABLE LIFE OWNERS. THIS REPORT IS NOT
AUTHORIZED FOR DISTRIBUTION TO
PROSPECTIVE INVESTORS UNLESS PRECEDED OR ACCOMPANIED BY AN EFFECTIVE
PROSPECTUS. NEITHER FIDELITY INVESTMENTS
LIFE INSURANCE COMPANY NOR FIDELITY BROKERAGE SERVICES, INC. IS A BANK, AND
NEITHER THE LIFE NOR MUTUAL FUND SHARES
ARE BACKED OR GUARANTEED BY ANY BANK OR INSURED BY THE FDIC.
STATEMENT OF ASSETS AND LIABILITIES
FIDELITY INVESTMENTS VARIABLE LIFE ACCOUNT I
OF
FIDELITY INVESTMENTS LIFE INSURANCE COMPANY
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DECEMBER 31, 1996
ASSETS
Investments at Current Market Value:
Variable Insurance Products Fund (VIP)
Money Market Portfolio - 464,982 shares (cost $464,982) $ 464,982
High Income Portfolio - 20,088 shares (cost $230,288) 251,506
Equity-Income Portfolio - 65,946 shares (cost $1,134,333) 1,386,852
Growth Portfolio - 45,203 shares (cost $1,119,232) 1,407,634
Overseas Portfolio - 21,245 shares (cost $368,662) 400,262
Variable Insurance Products Fund II (VIP II)
Investment Grade Bond Portfolio - 18,941 shares (cost $225,720) 231,839
Asset Manager Portfolio - 8,802 shares (cost $124,394) 149,023
Total Assets $ 4,292,098
LIABILITIES
Total Liabilities 0
NET ASSETS
Variable Life Contracts $ 4,269,917
Retained in Variable Account by Fidelity Investments Life Insurance Company 22,181
Total Net Assets $ 4,292,098
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FIDELITY INVESTMENTS VARIABLE LIFE ACCOUNT I
OF
FIDELITY INVESTMENTS LIFE INSURANCE COMPANY
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SUBACCOUNTS INVESTING IN:
VIP - VIP - VIP -
MONEY MARKET HIGH INCOME EQUITY-INCOME VIP - GROWTH
12/31/96 12/31/95 12/31/96 12/31/95 12/31/96 12/31/95 12/31/96 12/31/95
INCOME:
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Dividends $ 22,117 $ 30,669 $ 34,401 $ 16,822 $ 55,471 $ 56,446 $ 86,077 $ 4,726
EXPENSES:
Mortality risk, expense risk
and administrative charges 3,564 4,549 2,278 2,792 11,175 8,302 11,291 9,540
Net investment income (loss)18,553 26,120 32,123 14,030 44,296 48,144 74,786 (4,814)
Realized gain 0 0 12,007 7,444 118,019 63,868 137,321 47,678
Unrealized appreciation
(depreciation) during
the year 0 0 (9,326) 37,417 2,144 170,804 (54,665) 260,482
Net increase in net assets
from operations 18,553 26,120 34,804 58,891 164,459 282,816 157,442 303,346
Payments received
from policyholders 0 0 0 0 0 0 0 0
Transfers between
subaccounts, net (42,435) (56,668) (148,258) 98,772 6,363 400,300 40,807 221,480
Transfers for policy
terminations (21,044) (5,376) 0 (9,316) (34,260) (7,973) (117,771) (25,894)
Transfers for cost
of insurance (4,144) (5,434) (2,075) (3,356) (10,301) (9,324) (8,874) (9,456)
Other transfers (to) from
Fidelity Investments Life
Insurance Co., net (381) 8,701 (335) (1,279) (6,310) (3,739) (1,561) (10,074)
Net increase (decrease)
in net assets from
policy transactions (68,004) (58,777) (150,668) 84,821 (44,508) 379,264 (87,399) 176,056
Retained in (returned from)
Variable Life
Account I, net (30) (4,927) (5) (8,761) 13 (7,855) (192) (8,813)
Total increase (decrease)
in net assets (49,481) (37,584) (115,869) 134,951 119,964 654,225 69,851 470,589
Net assets at beginning
of period 514,463 552,047 367,375 232,424 1,266,888 612,663 1,337,783 867,194
Net assets at end of period $ 464,982 $ 514,463 $ 251,506 $ 367,375 $ 1,386,852 $ 1,266,888 $ 1,407,634 $ 1,337,783
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VIP II -
INVESTMENT VIP II -
VIP - OVERSEAS GRADE BOND ASSET MANAGER TOTAL
12/31/96 12/31/95 12/31/96 12/31/95 12/31/96 12/31/95 12/31/96 12/31/95
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$ 10,240 $ 3,083 $ 6,194 $ 21,004 $ 10,103 $ 4,472 $ 224,603 $ 137,222
3,691 2,696 2,083 2,730 1,269 1,407 35,351 32,016
6,549 387 4,111 18,274 8,834 3,065 189,252 105,206
26,349 21,383 9,214 15,367 3,736 7,154 306,646 162,894
15,323 4,489 (9,486) 16,841 6,514 13,851 (49,496) 503,884
48,221 26,259 3,839 50,482 19,084 24,070 446,402 771,984
0 0 0 0 0 0 0 0
103,543 (151,262) 46,416 (447,554) (6,436) (65,068) 0 0
(8,276) (10,522) (3,803) 0 (5,976) (23,955) (191,130) (83,036)
(3,993) (3,656) (2,606) (3,321) (1,476) (1,853) (33,469) (36,400)
(5,482) (208) (95) (611) (634) (1,349) (14,798) (8,559)
85,792 (165,648) 39,912 (451,486) (14,522) (92,225) (239,397) (127,995)
310 (6,510) (39) (5,271) 281 (7,581) 338 (49,718)
134,323 (145,899) 43,712 (406,275) 4,843 (75,736) 207,343 594,271
265,939 411,838 188,127 594,402 144,180 219,916 4,084,755 3,490,484
$ 400,262 $ 265,939 $ 231,839 $ 188,127 $ 149,023 $ 144,180 $ 4,292,098 $ 4,084,755
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FIDELITY INVESTMENTS VARIABLE LIFE ACCOUNT I
OF
FIDELITY INVESTMENTS LIFE INSURANCE COMPANY
1. ORGANIZATION.
Fidelity Investments Variable Life Account I (the Account), a unit
investment trust registered under the Investment Company Act of 1940 as
amended, was established by Fidelity Investments Life Insurance Company
(FILI) on July 22, 1987 and exists in accordance with the regulations of
the Utah Insurance Department. The Account is a funding vehicle for
individual variable life insurance contracts. FILI is a wholly-owned
subsidiary of FMR Corp.
2. SIGNIFICANT ACCOUNTING POLICIES.
Investments are made in the portfolios of the Variable Insurance Products
Fund and the Variable Insurance Products Fund II and are valued at the
reported net asset values of such portfolios. Transactions are recorded on
the trade date. Income from dividends is recorded on the ex-dividend date.
Realized gains and losses on the sales of investments are computed on the
basis of the identified cost of the investment sold.
The operations of the Account are included in the federal income tax return
of FILI, which is taxed as a life insurance company under the provisions of
the Internal Revenue Code (the Code).
The preparation of the statement of assets and liabilities and the
statements of operations and changes in net assets in accordance with
generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of liabilities
at the date of the financial statements and the reported amounts of income
and expense during the reporting period. Actual results could differ from
those estimates.
3. EXPENSES.
FILI deducts a daily charge from the net assets of the Account (equivalent
to an effective annual rate of .85%) for administrative expenses and for
the assumption of mortality and expense risks. In addition, the cost of
providing insurance protection is deducted monthly.
Under the current provisions of the Code, FILI does not expect to incur
federal income taxes on the earnings of the Account to the extent the
earnings are credited under the contracts. Based on this, no charge is
being made currently to the Account for federal income taxes. FILI will
review periodically the status of such decision based on changes in the tax
law. Such a charge may be made in future years for any federal income taxes
that would be attributable to the contracts.
4. AFFILIATED COMPANY TRANSACTIONS.
The contracts are distributed through Fidelity Brokerage Services, Inc.
(FBSI) and Fidelity Insurance Agency, Inc. (FIA), both of which are
affiliated with FMR Corp. FBSI and FIA are the distributors and FBSI is the
principal underwriter of the contracts. Fidelity Management & Research
Company, an affiliate of FMR Corp., acts as investment advisor to each
portfolio. Fidelity Investments Institutional Operations Co., an affiliate
of FMR Corp., is the transfer and shareholder servicing agent for the
portfolios.
5. PURCHASES AND SALES OF INVESTMENTS.
The following table shows aggregate cost of shares purchased and proceeds
from sales of each subaccount for the year ended December 31, 1996:
PURCHASES SALES
Money Market $ 424,442 $ 473,923
High Income 60,481 179,030
Equity-Income 379,636 379,833
Growth 368,441 381,248
Overseas 342,477 249,826
Investment Grade 172,854 128,870
Asset Manager 19,755 25,162
REPORT OF INDEPENDENT ACCOUNTANTS
To the Policyholders of Fidelity Investments
Variable Life Account I:
We have audited the accompanying statement of assets and liabilities of
Fidelity Investments Variable Life Account I (comprised of Money Market
Subaccount, High Income Subaccount, Equity-Income Subaccount, Growth
Subaccount, Overseas Subaccount, Investment Grade Bond Subaccount, and
Asset Manager Subaccount) of Fidelity Investments Life Insurance Company as
of December 31, 1996, and the related statements of operations and changes
in net assets for each of the periods indicated therein. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based
on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of the aforementioned
subaccounts comprising Fidelity Investments Variable Life Account I of
Fidelity Investments Life Insurance Company as of December 31, 1996, and
the results of their operations and the changes in their net assets for
each of the periods indicated therein, in conformity with generally
accepted accounting principles.
COOPERS & LYBRAND L.L.P.
Boston, Massachusetts
January 29, 1997
FIDELITY INVESTMENTS LIFE INSURANCE COMPANY
(registered trademark)
Fidelity Variable Life
is issued by Fidelity Investments Life Insurance Company
Fidelity Brokerage Services, Inc., member NYSE, SIPC, Fidelity Insurance
Agency, Inc., and Fidelity Investments Insurance
Agency of Texas, Inc. are the distributors.
82 Devonshire Street, Boston, MA 02109
